Rents Remain Unaffordable for Many, According to Center for Housing Policy Study

By Erika Schnitzer, Associate EditorWashington, D.C.—Many of the jobs created through the federal stimulus package do not pay enough for workers to afford rent, according to a new study by the Center for Housing Policy, the research affiliate of the National Housing Conference.The study, “Paycheck to Paycheck,” ranks homeownership and rental affordability for more than 60 occupations in over 200 U.S. metro areas.While home prices have declined and the income needed to purchase a median-priced home in most metro areas dropped from 2007 to 2008, rents increased in the majority of metro areas during the same period, the study found.Despite these increases, “we’ve seen indications—at least as of the fourth quarter of 2008—that the supply of apartments hasn’t kept up with the increase in demand,” Maya Brennan, research associate at the Center for Housing Policy, tells MHN. “There’s more demand for rentals because a lot of people who would be buying aren’t able to get into a home because of the tightened credit markets and homeowners have been pushed out by foreclosures.”Brennan adds, “We may start to see a change as condos and other ownership units are turned into rentals. The drop in rents may be limited to larger new developments or large garden-apartment communities, but it doesn’t seem, from the CPI, to have affected the nation as a whole.”One-third of the metro areas that were studied showed rent increases of 4 percent or more between 2007 and 2008, with the largest rent increase, of 7.8 percent, in Seattle. Nationally, rents in urban areas increased 3.7 percent.The study focused on construction-related occupations that could see a boost from the federal stimulus package. It found that of the five occupations in the sector studied, construction laborers are unable to rent a two-bedroom apartment in 161 out of the 210 markets studied, while homeownership is unaffordable in 196 out of 208 markets. Only construction managers can afford average rents in all markets and can afford to purchase a home in 199 of the respective markets.In addition, many traditional community workers, including teachers, nurses and police offers, as well as retail workers, are priced out of renting a two-bedroom apartment in most, if not all, of the markets studied. Licensed practical nurses could afford the rent for a two-bedroom apartment in only 47 of the 210 markets, while retail salespeople were priced out of all two-bedroom apartments and 184 markets for one-bedrooms.”Localities need to find ways to provide workforce housing for key employees,” including utilizing money from the neighborhood stabilization program, as well as converting vacant foreclosed homes into rental units, says Brennan. “We have a number of policies nationally that can work and help to provide adequate and affordable housing for community workers. The problem now is that so many states and localities are facing budget crunches and may cut back on housing trust funds and other ways [workforce housing] gets financed.”In terms of relative affordability, renting in the 14 Florida metro areas in the study became more unaffordable between 2007 and 2008, while most other markets held about steady in their placements.The following is a list of the top ten most expensive rental markets, with two-bedroom fair market rents, according to the study:1. San Francisco, $1,6582. Honolulu, $1,6313. Santa Cruz, Calif., $1,5904. Suffolk-Nassau, N.Y., $1,5815. Santa Ana, Calif., $1,5466. Oxnard, Calif., $1,5467. San Diego, $1,4188. Los Angeles, $1,3619. Edison, N.J., $1,34910. Boston/Cambridge, $1,345